Vermont has passed legislation governing interchange fees on credit and debit card transactions, becoming the first state to take such action, the Washington Post reported.
The move comes just one week after the U.S. Senate approved an amendment that would address interchange fees to the financial overhaul bill.
“What Vermont has done is a first step,” said the National Retail Federation’s General Counsel Mallory Duncan, who is also chairman of the Merchants Payments Coalition. “What the Senate has done is a more important step, but it’s not been completed, yet.”
As of Jan. 1, the state law will allow Vermont retailers to set a $10 minimum for credit and debit card charges and to offer a discount for cash-paying customers
Vermont lawmakers passed the legislation several weeks ago and sent it to Governor Jim Douglas for approval. While Douglas declined to sign the bill, he also did not veto it, allowing it to become law on May 21, without his signature.
Douglas noted that while he sympathized with merchants, he worried card companies might restrict the use of consumers’ cards in the state as a result of the new law.
“I do not believe …that legislation of this nature is best handled at the state level,” Douglas said.